EUROPE MARKETS: European Stocks Get Clobbered Again As Banks Slump
09 February 2016 - 8:17PM
Dow Jones News
By Sara Sjolin, MarketWatch
Banks bear the brunt of the selloff
European stock markets dropped for a seventh straight session on
Tuesday, with banks leading the charge lower as fears of a global
economic slowdown persist.
The Stoxx Europe 600 index slid 0.8% to 311.81, building on a
3.5% decline on Monday
(http://www.marketwatch.com/story/european-stocks-drop-to-15-month-low-2016-02-08),
when it closed at the lowest level since October 2014.
Germany's DAX 30 index , which slipped into bear territory on
Monday, gave up 0.5% to 8,931.01, while France's CAC 40 index
dropped 0.7% to 4,036.23. The U.K.'s FTSE 100 index fell 0.1% to
5,683.14.
Richard Perry, market analyst at Hantec Markets, said there was
not one specific catalyst behind the selloff, but a range of
factors.
"Concerns about global growth slowing down is the usual excuse,
whilst the $100 billion reduction in Chinese FX reserves is also a
red warning light. However, it is just a negative swarm of bear
pressure through markets that is a real concern," he said in a
note.
"Equity markets are losing key levels of support, and until
there is something tangible for investors to hang a positive
argument on (such as signs of economic improvement, or perhaps a
bullish signal on the oil price) it is difficult to see what will
stop the malaise," he added.
The downbeat trading mood in Europe was also made worse by data
showing an unexpected drop in German industrial production
(http://www.marketwatch.com/story/german-output-exports-drop-in-december-2016-02-09)
in December, another sign that Europe's largest economy ended 2015
on a weak note.
In Asia, Japan's Nikkei 225 tanked 5.4%
(http://www.marketwatch.com/story/nikkei-sharply-down-on-banking-energy-woes-2016-02-08),
sparked by fears of global economic weakness. China's markets are
closed for the Lunar New Year holiday.
Banks: Shares of Swedbank AB (SWED-A.SK) slid 4.5% after the
Swedish lender in a surprise move said it was replacing Chief
Executive Michael Wolf, with immediate effect
(http://www.marketwatch.com/story/swedbank-replaces-chief-executive-2016-02-09).
Other banks were also getting hit, continuing a recent slump for
the sector that is fueled by concerns over the impact of low oil
prices, negative interest rates and weak economic growth. The Stoxx
Europe 600 Banks Index dropped 1.1%, heading for its lowest close
since August 2012, according to FactSet data.
Read: Why a selloff in European banks is ominous
(http://www.marketwatch.com/story/why-a-selloff-in-european-banks-is-ominous-2016-02-07)
Banca Popolare di Milano Scarl (PMI.MI) lost 6.6%, UniCredit SpA
(UCG.MI) dropped 4.9% and Banco de Sabadell SA (SAB.MC) gave up
2.7%. Credit Suisse Group AG (CSGN.VX) and UBS Group AG (UBS) each
fell 4.1%.
However, shares of Svenska Handelsbanken AB jumped 4.7% after
the lender said profit surged 35%
(http://www.marketwatch.com/story/handelsbanken-profit-up-35-lifts-dividend-2016-02-09)
in the fourth quarter.
Other movers: Shares of Pandora AS (PNDORA.KO) slumped 7%, even
as the Danish jeweler raised dividends by 44%
(http://www.marketwatch.com/story/pandora-ups-dividend-44-to-launch-share-buyback-2016-02-09)
and launched a share buyback program.
On a more upbeat note, shares of Vestas Wind Systems AS (VWS.KO)
jumped 4.5% after a well-received earnings report from the
wind-turbine maker.
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(END) Dow Jones Newswires
February 09, 2016 04:02 ET (09:02 GMT)
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